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The Financial Obligations When Owning a Home

Saturday, December 17, 2016   /   by Jason Huerkamp

The Financial Obligations When Owning a Home

When purchasing a home, it is important to realize that there is more to just the mortgage payment that needs to be considered. If you are a first time home buyer these are some of the things you need to add to your monthly budget to make sure that you keep ahead of your finances.

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Payment on Mortgage

This monthly amount will depend on the type of mortgage you have. Do explore your mortgage options carefully and perhaps lock in a fixed mortgage rate for a period of time so that there are no increases or surprises.

Home Owners Insurance

Home Owners Insurance is really important and the Lender will probably insist you have that prior to the closing on your new home. That would keep their investment in your property safe and protect you for any unforeseen damages. The Home Owners insurance also covers any claim against you should someone be injured on your property or as a result of an issue in your property. Your Home Owners Insurance gives you peace of mind.

Property Taxes

Property Taxes are the fees levied by the local municipalities on your property which is then allocated to the maintenance and upkeep of roads, water systems, sewers, removing snow and then other general items that need to be paid for by your local municipality. Your Property Taxes are calculated on the assessed value of your home and are recalculated periodically to meet the needs of the locality.

Your Lender would probably be collecting your property taxes as part of your monthly mortgage payment and will make the annual payment on your behalf. Always check with the lender, it's a sizable amount to have to pay out if you have not budgeted for it.


It is important to make a list of the utilities that you would like to have and see how they can fit into your budget. The "nice to haves" may have to wait a while until your finances improve, but for the most part, here are the important ones and then the most often needed ones to include in your budget. 

  • Water
  • Natural Gas
  • Electricity
  • Telephone
  • Wifi
  • Cable


Maintenance and upkeep of a property lie hand in hand with home ownership. You need to keep your home well maintained and functioning correctly in order for your investment to keep its value. If you let maintenance slide, it is often too costly and too difficult to catch up and that is how homes become derelict and lose value.

Here are some of the items that need to be maintained regularly. 
  • Appliances
  • HVAC Heating and Cooling
  • Hot Water Heater
  • Fireplace
  • Yard
  • Pest Control

Every few years you do need to remodel slightly to keep your home value. Bathrooms and kitchens should be kept current and of course minor painting and colors need to be reviewed regularly. You can often use equity in your mortgage to do some remodeling, however if you include a remodeling budget annually for those upgrades, you can do them as you need to with money that you have access to immediately taking advantage of specials and bargains.

Major Upgrades and Improvements

When it comes to major improvements, like adding a room, you may want to consider whether your home still suits your needs and/or whether it may be time to upgrade or move. A great real estate agent will help you with a CMA and give you a clearer picture of your homes value and whether a major upgrade would be a good decision or a "time to move" decision instead.


Each year plan accordingly, set your funds aside and be on top of your finances. Know your financial goals and expenses and budget. 

First Time Home Buyers

There is often more to owning a home than initially considered and a great real estate agent will educate you about the process prior to making that financial commitment. There is more to owning a home than initially considered

A great real estate agent will educate you about the process of home buying and home owning. Take the time to find the right real estate agent to work with, one who will be there to assist you and meet all your real estate needs.

It is important to know that you can live within your budget and if you know that these are the financial obligations when owning a home you can take care to keep your finances in order and budget accordingly.

The Huerkamp Team are your real estate specialists in the Twin Cities and surrounding communities of Minnesota. We are ranked in the top 1% of agents nationwide! The Team is dedicated and experienced in the Twin Cities real estate market and we look forward to being your real estate agent for life! You will have a great experience buying or selling real estate.  We have many raving fans and the experience to deal with your real estate transaction. 

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Huerkamp Home Group
Jason Huerkamp
14300 Nicollet Court # 208
Burnsville, MN 55306

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